A lowering of sentiment for Asian indices today with all posting marked declines: the Hang Seng and Shanghai Composite were down -0.75% and -1.08% while weakness weighed on the Asia Dow and Nikkei. The South Korean Kospi was down more than -1.44% following a downgrade on Samsung from Morgan Stanley. The investment bank thinks Samsung may have been overly-reliant on semiconductor income.
In the UK the Government’s new post-Brexit industrial strategy is set for launch (though some confusion over what it is designed to do still lurks). Given weakening productivity and uncertainty around Brexit, clarity will be welcome. Expect R&D – think AI, personal mobility, healthcare in particular – to headline. The UK spends considerably less of its total GDP – 1.7% compared to 2.4% – than the average OECD country on R&D.
On the currency front the euro remains at a two-month high against the dollar. At 7am the euro was down -0.11% at 1.1918 while higher against the pound at 0.8952. This week US growth and home sales numbers emerge plus eurozone CPI estimates, both likely adding to currency tail winds. Optimism on a political Merkel deal can only support the euro further.
- UK FTSE 100 7,409.64 -0.10%
- Dow 23,557.99 +0.14%
- S&P 500 2,602.42 +0.21%
- Nasdaq 6,889.16 +0.32%
- Nikkei 225 22,495.99 -0.24%
- DAX 13,059.84 +0.39%
- CAC 40 5,390.46 +0.20%
- Gold 1,294.40 +0.20%
- Oil WTI 58.67 -0.47%
Ultra Electronics contracts win
A quiet day on the corporate reporting front. Ultra Electronics – its share price is down more than -36% year-to-date – this morning reported two new contracts worth £26m, one from Saab of Sweden (aircraft) plus a new surveillance tech contract.
“These contracts underpin the long-term success of the Group and highlight Ultra's ability to work closely with both Government and Industry,” said the company.
Ultra has been under pressure from UK defence cuts with the MoD cancelling some funding programs. Its former long-serving chief exec Rakesh Sharma recently quit.